The Malta Tax and Customs Administration has introduced specific rules regarding the tax treatment of individuals holding a Nomad Residence Permit, effective from January 1, 2024.
Under these guidelines, income derived from "authorised work"—defined as remote services provided via telecommunications to employers or clients who are not resident in Malta—is subject to a favorable tax rate of 10%.
Upon receiving their residence card, applicants are automatically registered for tax purposes, though it is important to note that holding this permit does not automatically grant official tax residency in Malta.
For most nomads, no tax is chargeable on income from authorised work for the first 12 months of residency, unless the individual chooses to file a declaration stating their stay is not of a "casual nature" to be taxed immediately.
Additionally, these permit holders are not subject to the Final Settlement System (FSS), meaning their non-resident employers have no Maltese tax withholding obligations. However, permit holders remain responsible for filing timely tax returns and providing documentation of any foreign taxes paid to claim double taxation relief. If a nomad changes status to work for a Malta-based employer, they must notify the Residency Malta Agency immediately, as their income will then become subject to standard progressive tax rate.
Key Takeaways: Malta Nomad Tax Rules
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Flat 10% Tax Rate: Income earned from remote "authorised work" for non-resident employers or clients is taxed at a fixed rate of 10%.
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12-Month Tax Holiday: Generally, no tax is charged on authorised work income for the first 12 months of residency unless you explicitly opt-in earlier.
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Remote Work Focus: To qualify, services must be provided via telecommunications technology to clients or employers who have no fixed place of business in Malta.
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No FSS Withholding: Non-resident employers are not required to participate in the Final Settlement System (FSS) or fulfill Maltese employment tax obligations.
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Automatic Registration: You are automatically registered for tax purposes once your Nomad Residence Card is issued, though this does not automatically make you a tax resident.
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Documentation Matters: To claim relief for any taxes paid abroad, you must provide official certificates or receipts to the authorities.
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Compliance is Mandatory: All permit holders must file timely tax returns and settle any dues by the established deadlines.